Houston home sales hit highest point since June 2010, data muddled by tax credit

The Houston metropolitan area is still feeling the effects of the first-time homebuyer tax credit, as May home sales, still weak, hit the highest point since the purchase incentive expired.
May sales in the Houston metro area of all residential property types hit 5,948, down 11.2% from a year ago — the highest number of sales since June 2010, according to the Houston Association of Realtors. Single-family home sales were down 11.9% compared to May 2010 with 5,043 sales, while condo sales declined 20.7% to just 441 units. (Click on charts to expand.)
"Getting an accurate read on the Houston real estate market remains challenging because the 2010 tax credit prompted a surge in home sales during the first half of last year that otherwise would have occurred throughout the summer," said Carlos Bujosa, HAR chairman.
While most of the country is experiencing home price declines, HAR reported the average sales price for a single-family residence in May 2011 at $220,210, up more than 6% compared to May 2010. The median sales price also increased 3.2% over the year prior to $157,900.
Foreclosures are accounting for a smaller slice of the market, statistics also indicate.
Foreclosed property sales accounted for 19.8% of all May home sales in the Houston area, down 3% compared to one year prior, according to HAR. In April, distressed properties made up 22% of all sales and in March they accounted for 23.5% of all sales.
Instead of purchasing homes, would-be buyers may be renting instead. HAR noted that the volume of renters "soared" in May. Demand for single-family home rentals surged 19.9% in May compared to a year ago and townhome and condominiums rentals jumped 24.6%, the firm said.
"With Houston's healthier employment climate, this demand has been largely driven by a steady influx of consumers from other parts of the country that may be waiting to sell the homes from which they've moved or who may be getting their finances in order before making a local home purchase," HAR said.
Write toChristine Ricciardi.